Battle Born Venture

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FOR CO-INVESTORS

OVERVIEW OF THE NEVADA VENTURE CAPITAL LANDSCAPE

August 27, 2014

Part of Battle Born’s mandate is to encourage a flourishing venture capital community in Nevada. To this end, we co-invest alongside other institutional investors, both in state and elsewhere, and offer this brief primer on the state’s investment environment by way of introduction for investors interested in partnering with us in Nevada. The Nevada venture capital landscape has seen numerous positive changes over the past few years; the introduction of two new funds, an influx of investment management firms, better business incentives, more support for entrepreneurs, and recognition of the State’s opportunities from large corporate.

A LARGER INVESTMENT COMMUNITY

In 2012, the Nevada Capital Investment Corporation (NCIC) allocated $50 million from the State of Nevada’s Permanent School Fund, to investment management firm Hamilton Lane. The Silver State Opportunity Fund is a private equity fund of funds, whose strategy is to invest at least 70% of its allocation in Nevada. Battle Born is a complementary program in that it invests in smaller Nevadan firms than are appropriate for the Silver State Opportunity Fund. These programs both represent ‘firsts’ for the State of Nevada. Recognizing Nevada’s advantages, investment firms, such as Huntington Capital, have opened investment offices in the State, joining an established network of angel groups (such as, Vegas Valley Angels, Sierra Angels and Reno Angels), venture capital and private equity investors. We anticipate this trend accelerating.

ACCOLADES FROM MAJOR CORPORATES

Nevada has always had great entrepreneurial spirit, and this was recognized in late 2012 by credit card firm American Express, which highlighted the State as one of the fastest growing for women-owned companies. Information technology major IBM also acknowledged the State’s advances by selecting Reno, NV as a winner of its 2013 Smarter Cities challenge, a highly competitive $400,000 grant which will allow Reno, NV to create sophisticated ‘big data’ analytics software, to provide citizens and developers complete access to information on properties within the city. Major corporations are accelerating their engagement with the State. In 2013, clean energy provider SolarCity opened a Las Vegas, NV location, which will create hundreds of jobs in the State over coming years. Consumer electronics firm, Apple, opened a 350 acre $1 billion data center in Reno, NV in 2014. Meanwhile, in May 2013, a unit of investment firm Berkshire Hathaway purchased Nevada’s largest utility, NV Energy, for $5.6 billion, a 23% premium to its trading price.

BETTER INCENTIVE PROGRAMS

In addition to its business-friendly tax and regulatory regime, Nevada is now able to offer relocation incentives to job-creating firms through the Catalyst Fund, introduced in 2011, and enhanced the links between industry and academia through joint research projects funded by the Knowledge Fund. The program is modeled after the highly successful 50-year old Fraunhofer Institute, and was funded by a $10 million allocation from the State of Nevada in June 2013. More info on Nevada incentive programs.

INCREASED ENTREPRENEUR SUPPORT

Nevadan entrepreneurs have long benefited from an extensive network of mentors and accelerator programs; our investment manager tracks 97 Nevada entities that offer mentoring in its resource directory. There have been new additions to the landscape over the past year. For example, privately-funded accelerator Roceteer opened in Las Vegas, NV, and foundation-backed Adams Hub in Carson City, NV.

In summary, Nevada is now better placed than at any time in the last decade to attract investors, entrepreneurs and corporates, and we look forward to your joining us in this endeavor.